Dividends Value » XOM

List of 195 Dividend Stocks Every Income Investor Should Know About *

D4L — Wed, 09 Mar 2011 07:30:16 +0000

In 2009, I introduced the Stock Ideas list and it has proven to be immensely popular. The list consists of Dividend Aristocrats, US Broad Dividend Achievers and U.S. Dividend Champions. Duplications in the above lists are eliminated and stocks are crossed out when I learn that they have either cut their dividend or fail to raise it. Here is some information on each of the constituent lists and some highlights on this year’s changes:

Dividend Aristocrats: Companies in the S&P 500 that have followed a policy of consistently increasing dividends every year for at least 25 consecutive years. As the name denotes, these are the best of the best – the blue blood stocks, including names like:

US Broad Dividend Achievers: Is comprised of companies incorporated in the United States or its territories, trade on the NYSE, NASDAQ or AMEX, and have increased their annual regular dividend payments for the last ten or more consecutive years. Notable names on this list include:

The U.S. Dividend Champions: Is maintained by Dave Fish of MoneyPaper. The list is updated monthly and located at the The Drip Investing Resource Center. Like the Dividend Aristocrats above the Dividend Champions list looks for companies that have increased their dividend for at least 25 consecutive years. However, since S&P 500 membership is not a requirement, the list is larger than the Dividend Aristocrats list and also includes small-cap companies.

- Bowl America (BWL.A) | Yield: 5.0%
- Conn. Water Service (CTWS) | Yield: 3.8%
- Weyco Group Inc. (WEYS) | Yield: 2.6%

Membership in the Stock Ideas list declined in this edition, but it was significantly less than what was experience in the prior year. Overall the number of constituents fell to 198 in the 2011 Stock Ideas list from 218 stocks in the 2010 list. There were 319 stocks in 2009. There were 28 companies that fell off the list, including these prominent stocks:

- Eli Lilly & Co. (LLY)
- Paychex Inc. (PAYX)
- Progress Energy Inc. (PGN)
- SUPERVALU Inc. (SVU)
- Integrys Energy Group, Inc. (TEG)

The news wasn’t all bad. Partially offsetting the 28 companies that fell off the list were 5 new companies joining the Dividend Stock Ideas List. Some of these aren’t household names, not yet at least, but here are some names we will likely be seeing in the future:

You can see the entire Dividend Stock Idea List here. Remember, not every stock listed here is a great dividend investment, but virtually all great dividend investments are on this list.

Full Disclosure: Long ABT, KO, JNJ, MCD, MMM, PG, WMT, CVX, NUE, LLY, TEG. See a list of all my income holdings here.

(Photo Credit)

Who Owns The Top Dividend Stocks? *

D4L — Wed, 12 Jan 2011 07:30:51 +0000

The internet provides investors with so much useful and interesting information. I could not imagine going back a decade or so and trying to analyze stocks without the internet – waiting for quarterly reports to be mailed for owned companies and calling the investor relations contacts for information on unowned companies. One of my job responsibilities is the statutory reporting for the corporation I work for. Filing 10-Ks, 10-Qs and other such required reports is often tedious, but it gives me a great appreciation of what information is available, including who owns some of the top dividend stocks…

In the U.S., the Securities and Exchange Commission (SEC) requires institutional investment managers who exercise investment discretion over $100 million or more in Section 13(f) securities to report their holdings on Form 13F with the SEC. Because of this required filing we can analyze the holdings of Berkshire Hathaway (Warren Buffett’s holding company) or any other large institution. However, once the Form 13Fs are aggregated, we can see who the large shareholders are for any public company, including these high profile dividend growth companies:

Johnson & Johnson (JNJ) | Yield: 3.5%
- 62.44% Institutional Ownership (%)
- 20.20% Top 10 Institutions (%)
- 00.79% 5%/Insider Ownership (%)
- 4.9% State Street Global Advisors (US)
- 3.8% Vanguard Group, Inc.
- 3.3% BlackRock Institutional Trust Company, N.A.
- 1.6% Berkshire Hathaway Inc.
- 1.4% State Farm Insurance Companies

The Coca-Cola Company (KO) | Yield: 2.8%
- 62.87% Institutional Ownership (%)
- 29.60 Top 10 Institutions (%)
- 04.68% 5%/Insider Ownership (%)
- 8.6% Berkshire Hathaway Inc.
- 3.7% Vanguard Group, Inc.
- 3.6% State Street Global Advisors (US)
- 3.2% Fidelity Management & Research
- 3.1% BlackRock Institutional Trust Company, N.A.

Procter & Gamble Co. (PG) | Yield: 3.0%
- 57.01% Institutional Ownership (%)
- 20.00% Top 10 Institutions (%)
- 00.34% 5%/Insider Ownership (%)
- 3.9% State Street Global Advisors (US)
- 3.8% Vanguard Group, Inc.
- 3.5% BlackRock Institutional Trust Company, N.A.
- 2.7% Berkshire Hathaway Inc.
- 1.5% Fidelity Management & Research

For the above I used MSN MoneyCentral, but many other services provide the same information. Obviously, large index mutual funds, such as the Vanguard Group, Inc. and Fidelity, will hold significant positions in S&P 500 companies, and those in other indexes. Insurance companies, such as Berkshire Hathaway Inc. and State Farm, will always have large sums invested in equities. The above three popular dividend growth stocks are all held by Berkshire Hathaway Inc. (BRK.A). As you can see from BRK.A’s latest 13F on the SEC’s website, they are also holding these other dividend growth stocks:

Buffett is a renowned value investor. As such, BRK.A’s 13F is one of the most viewed each quarter when it is filed. Investors want to know what the Oracle has bought and sold. Many websites use this information to set up a Buffett Tracking Portfolio, along with other respected investors. There is a great deal of information freely available to investors. Sometimes we just need to detour from our familiar paths to discover it.

Full Disclosure: Long JNJ, KO, PG, WMT. See a list of all my income holdings here.

(Photo Credit)

The 2011 Dividend Aristocrats *

D4L — Wed, 15 Dec 2010 07:30:21 +0000

The S&P 500 Dividend Aristocrats is the most prestigious list of dividend stocks. The Dividend Aristocrats index is designed to measure the performance of S&P 500 constituents that have followed a policy of consistently increasing dividends every year for at least 25 consecutive years. This index is a member of the S&P Dividend Aristocrats index series.

Dividend Aristocrats constituents exhibit the following characteristics:

- Underlying Indices – S&P 500
- Weighting – Equally weighted; Constituents re-weighted quarterly
- Reconstitution – Reviewed annually in December

Among others, Dividend Aristocrats include these highly recognizable names, with years of consecutive dividend increases shown:

- 3M Co. (MMM) – 52 years
- Abbott Laboratories (ABT) – 38 years
- Clorox Co (CLX) – 35 years
- Coca-Cola Co (KO) – 48 years
- Exxon (XOM) – 28 years
- Johnson & Johnson (JNJ) – 48 years
- McDonald’s Corp (MCD) – 34 years
- Procter & Gamble (PG) – 54 years
- Wal-Mart Stores (WMT) – 36 years

Members may be deleted during the December rebalance if calendar-year dividends did not increase from the previous year, or intra-year if the stock is removed from the underlying S&P 500.

On December 2nd, S&P announced changes to the Dividend Aristocrats Index. Standard & Poor’s will perform the annual reconstitution of the S&P 500 Dividend Aristocrats Index after the close of trading on Friday, December 17, 2010.

The following stocks will be added to the Dividend Aristocrats:

- McCormick & Company (MKC)
- Hormel Foods Corp. (HRL)
- Ecolab Inc. (ECL)

The following stocks will be dropped from the Dividend Aristocrats:

- Eli Lilly And Company (LLY)
- SUPERVALU Inc. (SVU)
- Integrys Energy Group, Inc. (TEG)

After last year’s significant decline, it is good see the membership number level off. The previous two years were difficult for dividend stocks, but that is not necessarily a bad thing. During good times it is easy for companies to increase dividends, and many companies were added to the index. It is during times of adversity that we learn who the real aristocrats are.

Full Disclosure: Long MMM, ABT, CLX, KO, JNJ, LLY, MCD, PG, TEG, WMT. See a list of all my income holdings here.

(Photo Credit)

Dividend Stocks Poised To Beat Inflation *

D4L — Wed, 15 Sep 2010 07:30:11 +0000

Investing in dividend growth stocks is not about buying a current high yield, but instead building a high yield-on-cost over time. One of the criticisms I am hearing more often is, “That low yield isn’t even covering inflation.” This is a very valid concern, if true. To test this criticism, I built a model it and ran several dividend stocks through it. The results just might surprise you…

Projected Inflation

First, let’s look at inflation, specifically the consumer price index for all urban consumers (CPI-U). I chose this index since it focuses on a typical market basket of goods and services consumed by all urban consumers. In the August 2010 Budget and Economic Outlook, published by the Congressional Budget Office (CBO), it offers a very mild outlook for inflation. The CBO is projecting the CPI-U for 2010 to be 1.6%, 1.0% in 2011, 1.7% in 2012-2014 and 2.3% 2015-2020.

Economic Growth

The mild inflation could be the result of a slow recovery. As for economic growth the CBO offered this:

In the past, many recoveries from deep recessions have been quite robust. After deferring purchases during a slump (especially for expensive goods like homes, automobiles, and capital equipment), households and businesses typically boost their spending quickly as economic prospects improve. However, international experience suggests that recoveries from recessions that were spurred by financial crises tend to be slower than average—perhaps because the losses in wealth and damage to the financial system that occur during such crises weigh on spending for a number of years. Following such a crisis, it takes time for consumers to rebuild their wealth, for financial institutions to restore their capital bases, and for nonfinancial firms to regain the confidence required to invest in new plant and equipment; all of those forces tend to restrain spending. In addition, under current law, both the waning of fiscal stimulus and the scheduled increases in taxes will temporarily subtract from growth, especially in 2011.

D4L-Inflation

With the above back-drop, I created an Excel model to compare a dividend growth stock to inflation. The model is simple to use. It has the following inputs:

Symbol: The dividend growth stock’s ticker symbol
Current Year: This year (2010)
Current Yield: The dividend growth stock’s current yield
Dividend Growth: The dividend growth stock’s estimated dividend growth rate
Inflation Rate: Estimated inflation rate

The Interpretative Analysis section calculates the net present value (NPV) of the annual differential between the dividend income investment and inflation (discounted at the inflation rate). The break-even button next to the Inflation Rate input field will calculate the inflation rate where the dividend stock investment equals inflation. Let’s run some numbers:

		Current	Dividend	Break
Company	Analysis	Yield	Growth	Even Inf.
Caseys, Inc. (CASY)	-	0.92%	15.47%	4.36%
ADM Co. (ADM)	-	1.77%	7.41%	3.57%
Wal-Mart Stores (WMT)	Link	2.33%	11.01%	6.57%
General Dynamics (GD)	Link	2.68%	10.07%	6.84%
Colgate (CL)	Link	2.68%	10.07%	8.70%
Exxon Corp. (XOM)	-	2.84%	4.82%	4.39%
Coca-Cola (KO)	Link	3.01%	7.32%	5.87%
J&J (JNJ)	Link	3.52%	8.42%	7.55%
Kimberly-Clark (KMB)	Link	3.98%	6.67%	7.21%
Piedmont Nat. Gas (PNY)	Link	4.00%	3.74%	5.55%

It is interesting to note that just a little dividend growth goes a long ways. One other consideration is taxes. To run the calculations on an after tax basis, simple enter the dividend yield on an after-tax basis. For example, if the dividend yield is 4% on a pretax basis and your marginal tax rate is 30%, then enter 2.8% as the dividend yield (4% x (100%-30%)).

You can download D4L-Inflation.xls and be prepared for the next time someone tells you that dividend stock is not even covering inflation. Just ask them what is their projected inflation rate and the stocks projected dividend growth rate.

Full Disclosure: Long WMT, GD, CL, KO, JNJ, KMB. See a list of all my income holdings here.

(Photo Credit)

What Determines A Dividend Stock’s Yield *

D4L — Wed, 16 Jun 2010 07:30:11 +0000

If income investing were as simple as picking the stock with the highest yield, everyone would be an expert. Most assume (rightfully so) that yield is heavily influenced by risk, but much more goes into determining yield. Below are several important factors that influence a stock’s yield, along with some illustrative examples:

Industry

Have you ever noticed that stocks within an industry often have similar yields? This makes sense when you consider they often have like operations with similar processes, cost structures and margins. This is evident when you look at retailers who buy similar products, resell them in a physical location and have fairly low margins due to the intense competition. Note the yield similarity of Target Corp. (TGT) with a 1.3% yield and Costco (COST) with a 1.5% yield. Even WalMart (WMT) with their economies of scale and focus on efficiency has a yield only slightly higher at 2.4%. The same analysis could be done with The Coca-Cola Company (KO) with a 3.4% yield and Pepsico, Inc. (PEP) with a 3.1% yield.

Maturity and Growth Potential

When Microsoft (MSFT) and Intel (INTC) were formed they paid no dividend. Instead they funneled all their cash back into growing the business. As they matured and growth slowed, each began to pay a very nominal dividend. Today, as they have continued to mature, their yields have continued to increase with MSFT paying 2.0% and INTC paying 3.0%.

Legal Considerations

Real Estate Investment Trusts (REIT), such as Realty Income Corp. (O) and HCP, Inc. (HCP), are not taxed as standalone entities. Instead, they are legally required each year to pay out a certain percentage of their profits as dividends. In effect this forces the shareholders to incur the tax as earnings are generated, leaving the company very little to fund growth. To pay for growth, REIT’s usually have to issue debt and/or equity. All of this combined usually results in REITs having a higher than average yield, for example O yields 5.8% and HCP yields 6.2%.

Risk

Risk still plays an important role in setting the yield for a company. Consider these energy companies with a similar yields: Chevron Corp. (CVX) with a 4.0% yield, Exxon Mobil Corp. (XOM) with a 3.0% yield and ConocoPhillips (COP) with a 4.1% yield. Then there is BP plc (BP) with a 9.0% yield. Is there any question which of these is the more risky stock to own?

The above list is not meant to be an exhaustive, but highlights some of the more common drivers of yield. When we see a yield that appears to be too good to true, we need to ask ourselves why is the yield so high, and is it sustainable?

Full Disclosure: Long CVX, JNJ, ABT, MCD, PG, KO. See a list of all my income holdings here.

(Photo Credit)

Managing Risk With Dividend Stocks *

D4L — Wed, 09 Jun 2010 07:30:02 +0000

When you purchase individual stocks, risk is inherit. Sometimes bad things sometimes happen to good stocks such as the Chicago Tylenol murders of 1982. This shook Johnson & Johnson’s (JNJ) , but eventually it prevailed. Sometimes it is difficult when a strong leader leaves a company and creates a void that just can’t be filled. Consider the performance of General Electric’s (GE) after Jack Welch retired and Microsoft’s (MSFT) after bill Gates began relinquishing his responsibilities. So how do you guard against these situations and disasters similar to what BP (BP) and their shareholders are currently facing?

Something Bad Will Happen

Eventually, every investor will hold a stock that falls out of favor and endures a double-digit decline. Understanding this from the onset makes it easier to deal with. If we go ahead and accept this as fact, then when it happens it really shouldn’t be a shock. This sounds simple, but is really an important step in removing emotion from the equation. It is much easier to reach the correct hold or sell decision when evaluating the facts from a rational perspective.

Diversify Your Holdings

When bad things happen to an individual stock, it usually pulls down other stocks in the same industry. Consider the April 20, 2010 explosion and fire on Transocean Ltd’s (RIG) drilling rig Deepwater Horizon licensed to BP where 11 workers were killed. It is more than a month later and BP still has not stopped the oil flow. Below you can see that several companies in the same industry, have all under-performed the S&P 500 (SPY), some more than others:

Company	Apr 19	Jun 1	%
S&P 500 (SPY)	$119.81	$107.53	-10.2%
BP (BP)	$59.48	$36.52	-38.6%
Halliburton (HAL)	$31.57	$21.15	-33.0%
Schlumberger (SLB)	$65.24	$51.75	-20.7%
Shell (RDS-A)	$61.00	$52.88	-13.3%
Exxon (XOM)	$68.23	$59.25	-13.2%
Chevron (CVX)	$81.32	$72.29	-11.1%

Limit Your Exposure

The single most important thing you can do to manage the risk associated with holding individual stocks is to simply limit your exposure. My standing rule is to limit each individual stock to no more than 5% of my income portfolio, based on market value and income. If any single company were to go bankrupt and the stock went to $0, my loss would be less than 5% – the market has moved my portfolio more than that in a single day.

At the end of March I held a position in BP that represented 1.6% of my income portfolio and generated 2.1% the portfolio’s income. This small position kept me from being overly concerned. If BP ended up bankrupting, these would not have been dramatic losses. Limiting your exposure in any single stock to a reasonable level lets you sleep at night even when that stock is facing adversity.

Focus On Quality

Your core portfolio should focus on quality with the “meat and potatoes” blue-chip stocks. You might want to add some high-yield and high-risk stocks in limited amounts to “spice” things up. Below are several quality blue-chip stocks that are the cornerstone of most dividend growth investor’s portfolio, along with their risk number:

Company	Analysis	Yield	Risk #
Abbott (ABT)	Link	3.71%	1.50
J&J (JNJ)	Link	3.63%	1.25
McDonald’s (MCD)	Link	3.30%	1.50
P&G (PG)	Link	3.20%	1.25
Coca-Cola (KO)	Link	3.44%	1.50

Finally, it is a good idea to have a written mission statement for your income portfolio that includes your goals and what you will and will not do in the portfolio. It may sound silly to take the time to write this down, but it is very helpful when fear or greed tempts you from your predefined path.

Full Disclosure: Long JNJ, ABT, MCD, PG, KO. See a list of all my income holdings here.

(Photo: sean carpenter)

How Often Should A Stock Pay And Raise Dividends? *

D4L — Fri, 30 Apr 2010 10:30:05 +0000

In the U.S. and Canada, most companies pay dividends quarterly. In other parts of the world, it is not uncommon for companies to pay an annual or a semi-annual dividend. That is not to say that North American companies sometimes choose not to pay quarterly dividends. For many years McDonald’s (MCD) paid an annual dividend. Since 2000, Walt Disney Co. (DIS) has paid an annual dividend and Ruby Tuesday, Inc. (RT) pays a semi-annual dividend. Going in the other direction, Realty Income Corp. (O) and Alpine Total Dynamic Dividend Fund (AOD) pay monthly dividends.

Though I prefer quarterly dividends, there is something more important than frequency — dividend increases. Below are several companies satisfying their shareholders desire for more cash by increasing their dividends:

Travelers (TRV) is a leading provider of commercial property-liability and homeowners and auto insurance. April 23rd the company increased its quarterly dividend to $0.36/share. The dividend is payable June 30, 2010, to shareholders of record as of the close of business June 10, 2010. The ex-dividend date is June 8, 2010. The yield based on the new payout is 2.85%.

Costco Wholesale (COST) operates about 565 membership warehouses in the U.S., Puerto Rico, Canada, the U.K., Taiwan, Japan, Korea, and Mexico. April 23rd the company raised its quarterly dividend 14% to $0.205/share. The dividend of $.205 per share is payable May 21, 2010, to shareholders of record at the close of business on May 7, 2010. The ex-dividend date is May 5, 2010. The yield based on the new payout is 1.39%.

Holly Energy Partners (HEP) operates refined product pipeline and terminal facilities. April 23rd the partnership raised its quarterly distribution to $0.815/unit. The distribution will be paid May 14, 2010, to unitholders of record May 4, 2010. The ex-distribution date is April 30, 2010. The yield based on the new payout is 6.98%.

International Paper (IP) is a leading worldwide producer and distributor of printing papers and packaging products. On April 26th the company increased its quarterly dividend to $0.125/share. The dividend is payable June 15, 2010 to shareholders of record on May 17, 2010. The ex-dividend date is May 13, 2010. The yield based on the new payout is 1.85%.

Alliance Holdings GP, L.P. (AHGP) produces and markets coal primarily to utilities and industrial users in the U.S. It offers a range of steam coal with varying sulfur and heat contents. April 26th the partnership increased its quarterly distribution 2.8% to $0.465/unit. The distribution is payable on May 20, 2010, to AHGP’s unitholders of record as of the close of trading on May 13, 2010. The ex-dividend date is May 13, 2010. The yield based on the new payout is 5.49%.

Community Bank System (CBU) provides financial services in upstate New York, and in northeastern Pennsylvania as First Liberty Bank & Trust. April 26th the company raised its quarterly dividend 9.1% to $0.24/share. The dividend is payable on July 9, 2010, to shareholders of record as of June 15, 2010. The ex-dividend date is June 11, 2010. CBU is a Dividend Achiever and has paid a higher dividend for 17 consecutive years. The yield based on the new payout is 3.89%.

Inergy Holdings (NRGP) operates a retail and wholesale propane supply, marketing and distribution business. April 26th the company increases its quarterly distribution 3.7% to $0.975/unit. The distribution will be paid on May 14, 2010, to unitholders of record as of May 7, 2010. The ex distribution date is May 5, 2010. The yield based on the new payout is 5.31%.

EarthLink (ELNK) is one of the largest U.S. Internet service providers, based on paying subscribers. April 27th the company increases it quarterly dividend to $0.16/share. This increase will be reflected in the next quarterly dividend to be paid on June 28, 2010 to shareholders of record on June 14, 2010. The ex-dividend date is June 12, 2010. The yield based on the new payout is 6.88%.

Williams Partners (WPZ) engages in gathering, transporting, processing, and treating natural gas, as well as fractionating and storing natural gas liquids. April 27th the company increases its quarterly distribution 3.5% to $0.66/unit. The distribution is payable on May 14, 2010, to unitholders of record at the close of business on May 7, 2010. The yield based on the new payout is 6.31%.

IBM (IBM) products and services include information technology services, software, computer hardware equipment, fundamental research, and related financing. April 27th the company raised its quarterly dividend 18% to $0.65/share. The dividend is payable June 10, 2010 to stockholders of record May 10, 2010. The ex-dividend date is May 6, 2010. This is the 15th year in a row that IBM has increased its quarterly cash dividend, and 7th year in a row of double-digit percent increases. With the payment of the June 10th dividend, this Dividend Achiever will have paid consecutive quarterly dividends every year since 1916. The yield based on the new payout is 2.02%.

Sunoco Logistics Partners LP (SXL) owns and operates a group of refined product and crude oil pipelines and terminal facilities. April 27th the company increases its quarterly distribution 2.3% to $1.11/unit. The yield based on the new payout is 6.54%.

WW Grainger (GWW) is the largest global distributor of industrial and commercial supplies such as hand tools, electric motors, light bulbs and janitorial items. April 28th the company raised its quarterly dividend 17% to $0.54/share. April 28th the company raised its quarterly dividend 17% to $0.54/share. The dividend is payable on June 1 to shareholders of record on May 10. The ex-dividend date is May 6. GWW is a Dividend Aristocrat and has paid a higher dividend for 39 consecutive years. The yield based on the new payout is 1.99%. See recent analysis.

Exxon (XOM) is the world’s largest publicly owned integrated oil company. April 28th the company raised its quarterly dividend 4.8% to $0.44/share. The dividend is payable on June 10, 2010 to shareholders of record of Common Stock at the close of business on May 13, 2010. XOM is a Dividend Aristocrat and has paid a higher dividend for 28 consecutive years. The yield based on the new payout is 2.54%.

Chevron (CVX) is a global integrated oil company that has interests in exploration, production, refining and marketing, and petrochemicals. April 28th the company increased its quarterly dividend 5.9% to $0.72/share. The dividend is payable June 10, 2010, to holders of common stock as shown on the transfer records of the Corporation at the close of business on May 19, 2010. The ex-dividend date is May 17. The amount represents a 5.9 percent increase in the company’s quarterly dividend. CVX is a Dividend Achiever and has paid a higher dividend for 23 consecutive years. The yield based on the new payout is 3.37%.

Sturm, Ruger & Co. (RGR) designs, manufactures, and sells firearms to domestic customers; it offers products in four industry product categories: rifles, shotguns, pistols, and revolvers. April 28th the company raised its quarterly dividend 55% to $0.093/share. The dividend will be paid on May 28, 2010 to stockholders of record as of May 14, 2010. The ex-dividend date is May 12, 2010. The yield based on the new payout is 2.16%.

TransAlta Corp. (TAC) is an independent power producer and wholesale marketing company owns a portfolio of generation assets in Canada, the United States, Mexico, and Australia. April 29th the company increased its quarterly dividend to $0.29/share. The dividend is payable July 1, 2010 to shareholders of record at the close of business June 1, 2010. The ex-dividend date is May 28, 2010. The yield based on the new payout is 5.59%.

Cullen/Frost Bankers (CFR) is the largest multi-bank holding company headquartered in Texas, has more than 80 offices in various cities in the state. April 29th the company increases its quarterly dividend 4.7% to $0.45/share. The dividend is payable June 15, 2010 to shareholders of record on June 1, 2010. The ex-dividend date is May 28, 2010. CFR is a Dividend Achiever and has paid a higher dividend for 16 consecutive years. The yield based on the new payout is 3.02%.

Duff & Phelps (DUF) is an independent financial advisory company operates worldwide in two segments, Financial Advisory and Investment Banking. April 29th the company raised its quarterly dividend by 20% to $0.06/share. The yield based on the new payout is 1.50%.

Frequency of dividends increases is one of the most important things to consider when adopting a dividend growth investment strategy. For a list of stocks with a long string of consecutive cash dividend increases, see this list.

Full Disclosure: Long MCD, AOD, CVX, O, PG, JNJ. See a list of all my income holdings here.

(Photo Credit)

The 2010 Dividend Stock Ideas List *

D4L — Wed, 24 Feb 2010 11:30:53 +0000

Last year I introduced the Stock Ideas list and it has proven to be immensely popular. The list consists of Dividend Aristocrats, US Broad Dividend Achievers and U.S. Dividend Champions. Duplications in the above lists are eliminated and stocks are crossed out when I learn that they have either cut their dividend or fail to raise it. Here are some highlights on this year’s changes:

- Bowl America (BWL.A) | Yield: 4.50%
- Conn. Water Service (CTWS) | Yield: 4.00%
- Weyco Group Inc. (WEYS) | Yield: 2.70%

Needless to say, last year saw many companies fall off the list. Overall the number of constituents fell to 218 stocks in 2010 from 319 in 2009. What made last year so unusual were the number of big-name companies that no longer qualified for inclusion on the list, some that had paid increasing dividends for decades, including:

- American International Group, Inc. (AIG)
– Bank of America Corporation (BAC)
– General Electric Co. (GE)
- The Home Depot, Inc. (HD)
- Johnson Controls Inc. (JCI)
- Pfizer Inc. (PFE)
- US Bancorp (USB)

The news wasn’t all bad. Partially offsetting the 133 companies that fell off the list were 32 new companies joining the Dividend Stock Ideas List. For the most part, these aren’t household names, not yet at least, but here are some names we will likely be seeing in the future:

- Arrow Financial Corporation (AROW) | Yield: 3.90%
- Energy Transfer Partners L.P. (ETP) | Yield: 7.80%
- Federated Investors, Inc. (FII) | Yield: 3.70%
- Getty Realty Corp. (GTY) | Yield: 8.50%
- Hudson City Bancorp, Inc. (HCBK) | Yield: 4.60%
- Investors Real Estate Trust (IRET) | Yield: 7.80%
- NSTAR (NST) | Yield: 4.60%
- Northeast Utilities (NU) | Yield: 3.80%
- Plains All American Pipeline LP (PAA) | Yield: 6.80%
- Suburban Propane Partners LP (SPH) | Yield: 7.30%

You can see the entire Dividend Stock Idea List here. Remember, not every stock listed here is a great dividend investment, but virtually all great dividend investments are on this list.

Full Disclosure: Long CLX, KO, EMR, JNJ, MCD, PG, WMT, CVX, NUE. See a list of all my income holdings here.

(Photo Credit)

38 Dividend Securities For A Well-Rounded Asset Allocation *

D4L — Wed, 17 Feb 2010 11:30:12 +0000

I am a firm believer that asset allocation plays a significant part in a portfolio’s long-term results. Recently, I received a question asking if you could have a diversified portfolio of dividend stocks. It is an interesting question that deserves further examination.

As for my portfolio, I consider asset allocation only when looking at my holdings in total. It would be much too difficult to maintain a good allocation within individual portfolios (income, growth, 401(k), Roth IRA, etc.), while trying to maintain my overall allocation. However, an investor could build a degree of allocation into a portfolio of dividend income securities. Consider the following:

Business Services Sector

Automatic Data Processing Inc. (ADP)
Yield: 3.33% | Style: Large Growth | Analysis
C H Robinson Worldwide Inc. (CHRW)
Yield: 1.86% | Style: Large Growth
Expeditors International of Washington Inc. (EXPD)
Yield: 1.16% | Style: Mid Growth

Consumer Goods Sector

Clorox Company (CLX)
Yield: 3.23% | Style: Mid Core
Coca-Cola Company (KO)
Yield: 3.04% | Style: Large Growth | Analysis
Procter & Gamble Company (PG)
Yield: 2.85% | Style: Large Core | Analysis

Consumer Services Sector

Genuine Parts Company (GPC)
Yield: 4.19% | Style: Mid Value | Analysis
Sysco Corporation (SYY)
Yield: 3.56% | Style: Large Core | Analysis
McDonald’s Corporation (MCD)
Yield: 3.22% | Style: Large Core | Analysis

Energy Sector

BP Plc ADR (BP)
Yield: 6.15% | Style: Large Value
Chevron Corporation (CVX)
Yield: 3.75% | Style: Large Value
ExxonMobil Corporation (XOM)
Yield: 2.56% | Style: Large Value

Financial Services Sector

Harleysville Group Inc. (HGIC)
Yield: 3.90% | Style: Small Value | Analysis
Chubb Corporation (CB)
Yield: 2.85% | Style: Large Value | Analysis
Aflac Inc. (AFL)
Yield: 2.38% | Style: Large Core | Analysis

Hardware Sector

Diebold Incorporated (DBD)
Yield: 3.67% | Style: Small Value
Linear Technology (LLTC)
Yield: 3.23% | Style: Mid Core
Raven Industries Inc. (RAVN)
Yield: 1.90% | Style: Small Growth | Analysis

Health Care Sector

Meridian Bioscience Inc. (VIVO)
Yield: 3.27% | Style: Small Growth
Johnson & Johnson (JNJ)
Yield: 3.08% | Style: Large Core | Analysis
Cardinal Health Inc. (CAH)
Yield: 2.10% | Style: Large Core | Analysis

Industrial Materials Sector

Nucor Corp. (NUE)
Yield: 3.40% | Style: Large Core | Analysis
Emerson Electric Co. (EMR)
Yield: 2.90% | Style: Large Core | Analysis
3M Company (MMM)
Yield: 2.58% | Style: Large Core

Media Sector

McGraw-Hill Companies Inc. (MHP)
Yield: 2.63% | Style: Large Core

Pharmaceuticals Sector

Eli Lilly & Company (LLY)
Yield: 5.77% | Style: Large Value
Abbott Laboratories (ABT)
Yield: 2.97% | Style: Large Growth | Analysis

Real Estate Sector

Essex Property Trust (ESS)
Yield: 5.14% | Style: Mid Core
Corporate Office Properties Trust Inc. (OFC)
Yield: 4.29% | Style: Mid Core
Federal Realty Investment Trust (FRT)
Yield: 4.06% | Style: Mid Core

Telecommunications Sector

CenturyLink Inc. (CTL)
Yield: 8.10% | Style: Large Value
AT&T Inc. (T)
Yield: 6.54% | Style: Large Value | Analysis

Utilities Sector

Integrys Energy Group Inc. (TEG)
Yield: 6.61% | Style: Mid Value
Consolidated Edison Company (ED)
Yield: 5.59% | Style: Large Value
MGE Energy Inc. (MGEE)
Yield: 4.45% | Style: Small Core

Bonds

Vanguard Short-Term Bond ETF (BSV)
Yield: 2.74% | Style: Short-Term Bond
Vanguard Intermediate-Term Bond ETF (BIV)
Yield: 4.32% | Style: Intermediate-Term Bond
Vanguard Long-Term Bond ETF (BLV)
Yield: 5.16% | Style: Long-Term Bond

Needless to say, the above will not provide a perfect allocation, but it goes a long way to provide diversity in a portfolio focused only on income securities. In my personal portfolio, I buy the best available dividend securities and use my other investments to balance my asset allocation.

Full Disclosure: Long ABT, ADP, AFL, BIV, BLV, BP, CLX, CTL, CVX, ED, EMR, GPC, HGIC, JNJ, KO, LLY, MCD, MMM, NUE, PG, SYY, T, TEG. See a list of all my income holdings here.

(Photo Credit)

10 Stocks With 100+ Years of Dividend Payments *

D4L — Wed, 27 Jan 2010 11:30:54 +0000

Over the last couple of years we have seen companies fail to raise their dividend, cut their dividend and some even decided to stop paying their dividend. In some cases their financials did not warrant the change. One way to weed these out is to look for companies with a dividend culture. Below are 10 companies that have paid a dividend for over 100 years and have increased their dividend for at least 20 years. They are presented here in descending rank of how long they have paid a dividend:

#10 Chubb Corp. (CB) One of the largest U.S. property-casualty insurers, Chubb has carved out a number of niches, including high-end personal lines and specialty liability lines coverage.
Paid since: 1902 | Consecutive increases: 45 | Yield: 2.92%

#9 PPG (PPG) is a leading manufacturer of coatings and resins, flat and fiber glass, and industrial and specialty chemicals.
Paid since: 1899 | Consecutive increases: 36 | Yield: 3.55%

#8 Colgate-Palmolive Company (CL) is a consumer products company, whose products are marketed throughout the world. Colgate’s Oral Care products include toothpaste, toothbrushes, oral rinses, dental floss and pharmaceutical products.
Paid since: 1895 | Consecutive increases: 45 | Yield: 2.13%

#7 The Coca-Cola Company (KO) is the world’s largest soft drink company. It engages in the manufacture, distribution, and marketing of nonalcoholic beverage concentrates, fruit juices and syrups worldwide.
Paid since: 1893 | Consecutive increases: 47 | Yield: 3.02% | [Analysis]

#6 The Procter & Gamble Company (PG) is focused on providing branded consumer goods products. The Company markets its products in more than 180 countries.
Paid since: 1891 | Consecutive increases: 53 | Yield: 2.92% | [Analysis]

#5 UGI Corp. (UGI) operates propane distribution, gas and electric utility, energy marketing and related businesses through subsidiaries.
Paid since: 1885 | Consecutive increases: 23 | Yield: 3.20%

#4 Consolidated Edison, Inc. (ED), through its subsidiaries, provides electric, gas, and steam utility services in the United States serving parts of New York, New Jersey and Pennsylvania.
Paid since: 1885 | Consecutive increases: 36 | Yield: 5.42%

#3 Eli Lilly and Company (LLY) discovers, develops, manufactures and sells prescription drugs that offers a wide range of treatments for neurological disorders, diabetes, cancer, and other conditions. The company also sells animal health products.
Paid since: 1885 | Consecutive increases: 42 | Yield: 5.52% | [Analysis]

#2 Exxon Mobil Corp. (XOM) is engaged in the exploration, production, and sale of crude oil, natural gas, petroleum products and petrochemicals. XOM is the world’s largest publicly owned integrated oil company.
Paid since: 1882 | Consecutive increases: 27 | Yield: 2.51%

#1 Stanley Works (SWK) is a worldwide producer of tools, hardware and specialty hardware for home improvement, consumer, industrial and professional use.
Paid since: 1877 | Consecutive increases: 42 | Yield: 2.44%

A strong dividend culture is a great place to start looking, but before buying we must also consider other factors such as: dividend fundamentals, ability to cover their dividend and fair value.

Full Disclosure: Long KO, PG, ED, LLY. See a list of all my income holdings here.